[Federal Register Volume 77, Number 66 (Thursday, April 5, 2012)]
[Notices]
[Pages 20633-20635]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-8192]
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FEDERAL MARITIME COMMISSION
[Docket No. 12-01]
OC International Freight, Inc., OMJ International Freight, Inc.
and Omar Collado; Order for Hearing on Appeal of Denial of License and
Order of Investigation and Hearing; Possible Violations of Sections
10(A)(1) and 19 of the Shipping Act of 1984
I. Appeal of FMC Staff Determination to Deny OTI License
OC International Freight, Inc. (OC) submitted an application on
December 2, 2010, for a license as an Ocean Transportation Intermediary
(OTI) to operate as a Non-Vessel-Operating Common Carrier (NVOCC) and
as an Ocean Freight Forwarder (FF). OC was incorporated on February 27,
2007 in the State of Florida, and OC is currently located at 4458 NW
74th Avenue, Miami, FL, 33166. Omar Collado is identified in the
application as OC's Qualifying Individual, as well as its President,
Secretary and sole owner.
On November 17, 2011, the Bureau of Certification and Licensing
(BCL) issued a Notice of Intent to Deny OC's license
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application in accordance with 46 CFR 515.15. As reflected in BCL's
Notice of Intent, that action stemmed from the results of an
investigation by the Commission's Miami Area Representative (AR)
revealing that the applicant, the applicant's Qualifying Individual and
a predecessor corporation, OMJ International Freight, Inc.,\1\ may have
violated sections 10(a)(1) and 19 of the Shipping Act, 46 U.S.C.
41102(a), 40901-40902. BCL's letter advised that, under 46 CFR 515.15,
denial of an OTI license is appropriate when the Commission cannot rely
upon the character or integrity of the applicant, or its principals, to
the extent necessary to ensure future conduct within the requirements
of the Shipping Act and the Commission's regulations. Based on the AR's
investigation, BCL concluded that OC, and its qualifying individual,
Mr. Collado, lacked the requisite character to be licensed as an OTI.
OC timely requested a hearing on the denial of its license application
under 46 CFR 515.15(c).
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\1\ OMJ International Freight, Inc. (OMJ) was incorporated on
March 15, 1999, and was licensed as a freight forwarder and NVOCC on
September 13, 2006. Omar Collado serves as the president, Qualifying
Individual and sole owner of OMJ. OMJ's license was automatically
revoked on January 15, 2010 following termination of its OTI bond by
the surety company. See 46 CFR 515.26.
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II. Investigation of Possible Violations of the Shipping Act
Central to the applicant's request for hearing here, Mr. Collado
challenges whether he, OMJ and/or OC should be found to have violated
the Shipping Act and the Commission's regulations. Specifically, the
AR's investigation asserted that between October 2007 and October 2009,
Mr. Collado and OMJ allowed its foreign-based unbonded OTI counterpart,
Island Cargo Services, to utilize OMJ's service contracts in numerous
instances. Although identified as the NVO on the underlying service
contract with Seaboard Marine, the AR found that Mr. Collado did not
issue an OMJ house bill of lading and never billed the cargo owner for
ocean freight. Rather, Mr. Collado permitted Island Cargo Services to
issue the latter company's house bill. Acting either as OMJ or OC,\2\
Mr. Collado allegedly provided only freight forwarding, warehousing,
trucking and loading services for each of these shipments. On the basis
of those facts, the Commission's Miami AR concluded that Mr. Collado,
OMJ and OC knowingly and willfully violated section 10(a)(1) of the
Shipping Act by allowing other persons to obtain ocean transportation
for property at less than the applicable rates and charges through the
device of permitting such persons to unlawfully access OMJ's service
contracts.
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\2\ During this same period, OMJ was dissolved as a Florida
corporation, at which time Collado appears to have begun conducting
business, in part, under the OC name, using OC letterhead. Neither
the dissolution of OMJ (a licensed entity) nor the apparent license
transfer from OMJ to OC was reported to BCL. 46 CFR 515.18.
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For the period following revocation of OMJ's license for failure to
maintain a bond on January 15, 2010, the Miami AR asserted also that
Mr. Collado, OMJ and OC continued to provide ocean freight forwarder
services at a time when they no longer possessed a valid OTI license or
bond. The Miami AR concluded that Mr. Collado, OMJ and OC violated
section 19 by acting as an unlicensed and unbonded OTI on more than 100
occasions beginning on or after January 16, 2010 and continuing through
at least October 26, 2010. At the conclusion of the AR's investigation,
Mr. Collado requested settlement negotiations with the Commission's
Bureau of Enforcement (BOE). However, negotiations with BOE terminated
unsuccessfully.
Section 19 of the Shipping Act of 1984, 46 U.S.C. 40901, provides
that the Commission shall issue an OTI license only to persons that it
determines to be qualified by experience and character. The
Commission's regulations at 46 CFR 515.15 implement the standards for
licensing under section 19, and state that:
If the Commission determines, as a result of its investigation,
that the applicant: (a) Does not possess the necessary experience or
character to render intermediary services; (b) Has failed to respond
to any lawful inquiry of the Commission; or (c) Has made any
materially false or misleading statement to the Commission; then a
letter of intent to deny the application shall be sent to the
applicant * * *.
The Commission's regulations thus require denial of an application
for an OTI license if the applicant does not possess the necessary
character to render OTI services. Based on a finding that the applicant
did not possess the necessary character, BCL issued its determination
on November 17, 2011 advising Mr. Collado of the intention to deny OC's
application.
Pursuant to Mr. Collado's request for hearing, the Commission must
determine whether BCL's determination to deny the OTI license
application should now be upheld. That decision is factually related to
the alleged violations by Mr. Collado, OMJ and OC. Given the common set
of facts relating to Mr. Collado's, OMJ's and OC's past (and current)
OTI operations, findings upon which the Commission may both analyze
BCL's denial of the OTI application and BOE's allegations of Shipping
Act violations, a combined proceeding would provide an efficient
process.
Now therefore, it is ordered That, pursuant to sections 11 and 19
of the Shipping Act of 1984, 46 U.S.C. 40901, 40902, 41302 and 41304,
an adjudicatory proceeding is hereby instituted to determine:
(1) Whether to affirm BCL's November 17, 2011 denial of the OTI
application of OC International Freight, Inc. and Omar Collado;
(2) Whether OC International Freight, Inc., OMJ International
Freight, Inc. and/or Omar Collado violated Section 10(a)(1) of the
Shipping Act, 46 U.S.C. 41102(a), by knowingly and willfully allowing
other persons to obtain ocean transportation for property at less than
the rates and charges that would otherwise be applicable through the
device of permitting such persons to unlawfully access OMJ's service
contracts;
(3) Whether OC International Freight, Inc., OMJ International
Freight, Inc. and/or Omar Collado violated section 19(a) and (b) of the
Shipping Act, 46 U.S.C. 40901 and 40902, by acting as an ocean
transportation intermediary without a license or evidence of financial
responsibility;
(4) Whether, in the event violations of sections 10 or 19 of the
Shipping Act are found, civil penalties should be assessed against OC
International Freight, Inc., OMJ International Freight, Inc. and/or
Omar Collado, and, if so, the amount of penalties to be assessed; and
(5) Whether, in the event violations are found, appropriate cease
and desist orders should be issued.
It is further ordered, That a public hearing be held in this
proceeding and that this matter be assigned for hearing before an
Administrative Law Judge of the Commission's Office of Administrative
Law Judges in compliance with Rule 61 of the Commission's Rules of
Practice and Procedure, 46 CFR 502.61. The hearing shall include oral
testimony and cross-examination in the discretion of the Presiding
Administrative Law Judge only after consideration has been given by the
parties and the Presiding Administrative Law Judge to the use of
alternative forms of dispute resolution, and upon a proper showing that
there are genuine issues of material fact that cannot be resolved on
the basis of sworn statements, affidavits, depositions, or other
documents or that the nature of the matters in issue is such that an
oral hearing and cross-examination are
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necessary for the development of an adequate record;
It is further ordered That, OC International Freight, Inc., OMJ
International Freight, Inc. and Omar Collado be made Respondents in
this proceeding;
It is further ordered That the Commission's Bureau of Enforcement
be made a party to this proceeding;
It is further ordered, That notice of this Order be published in
the Federal Register, and a copy be served on parties of record;
It is further ordered, That other persons having an interest in
participating in this proceeding may file petitions for leave to
intervene in accordance with Rule 72 of the Commission's Rules of
Practice and Procedure, 46 CFR 502.72;
It is further ordered, That all further notices, orders and/or
decisions issued by or on behalf of the Commission in this proceeding,
including notice of the time and place of hearing or prehearing
conference, shall be served on all parties of record;
It is further ordered, That all documents submitted by any party of
record in this proceeding shall be directed to the Secretary, Federal
Maritime Commission, Washington, DC 20573, in accordance with Rule 2 of
the Commission's Rules of Practice and Procedure, 46 CFR 502.2, and
shall be served on all parties of record; and
It is further ordered, That in accordance with Rule 61 of the
Commission's Rules of Practice and Procedure, the initial decision of
the Administrative Law Judge shall be issued by April 2, 2013, and the
final decision of the Commission shall be issued by July 31, 2013.
By the Commission.
Karen V. Gregory,
Secretary.
[FR Doc. 2012-8192 Filed 4-4-12; 8:45 am]
BILLING CODE 6730-01-P